Canadian cable-television and mobile-phone provider, Rogers Communications is buying Call-Net in a share for share transaction valued at about C$330 million ($264 million).
Call-Net Enterprises is the parent company of Sprint Canada. Rogers Communications hopes for the deal to give it more power in the local phone market, which it is now entering.
Call-Net’s Common and Class B shareholders will get a fixed exchange ratio of one Rogers Class B Non-voting share for each 4.25 outstanding shares of Call-Net according to a press release.
“This acquisition will significantly jumpstart and expand our ability to provide customers with a full suite of service solutions that deliver the simplicity, quality and value they want in one package, on one bill, from one provider,” said Rogers President and CEO Ted Rogers. “This positions us immediately to offer primary line telephone service across our residential and business bases of wireless and cable customers.”
“This is a terrific day for Call-Net customers, shareholders, employees, and for Canadian telecom in general,” said Bill Linton, President and CEO of Call-Net. “We share a common heritage with Rogers as a catalyst in bringing competition to the Canadian communications markets.”
The deal, which is subject to regulatory approval and shareholder acceptance, is expected to close in the third quarter of 2005. Call-Net has agreed not to solicit or take certain other actions with respect to any competing proposal, and in addition has agreed to pay Rogers a termination fee of $10 million under specified conditions.
Chris is a staff writer for Murdok. Visit Murdok for the latest ebusiness news.
